CUNA Seeks Input on New Proposal for International Remittance Transfers
Definition of a “remittance transfer” - An electronic transfer of funds greater than $15 requested by a consumer sender (sender) to a designated recipient sent by a remittance transfer provider (provider), regardless of whether the sender holds an account with the provider or if the transaction is also an electronic fund transfer. A “remittance transfer” does not include securities or commodities transfers or any transfer that is excluded from the definition of electronic fund transfer.
The Official Commentary to the rule provides these examples of remittance transfers:
International consumer wire transfers;
International ACH transactions;
Transfers where the consumer sender provides cash or another method of payment to a money transmitter or financial institution and requests that funds be send to a specified location or account in a foreign country;
An addition of funds to a prepaid card by a participant in a prepaid card program where the prepaid card is sent or was previously sent by a participant in the prepaid card program to a person in a foreign country; or
Online bill payments and other electronic transfers that a sender schedules in advance, including preauthorized remittance transfers, made by the sender's financial institution at the sender's request to a designated recipient (in another country).
Remittance transfers do NOT include:
A consumer's provision of a debit, credit, or prepaid card, directly to a foreign merchant as payment for goods or services;
A consumer's deposit of funds to a checking or savings account located in the U.S., because there has not been a transfer to a designated recipient; or
Online bill payments and other transfers that senders can schedule in advance, made on a website of a merchant in a foreign country and via direct provision of a checking account, credit card, debit card, or prepaid card to the merchant.
Please note: When typing responses to fill-in-the-blank questions, please do not hit the [Enter] key. Doing so will submit the survey before you have finished it.
Based on this definition, does your credit union offer international remittance transfers to your members?
No (if no, skip to Q.5)
If you do offer these services to your members, how many transfers do you provide, on average, in a typical month?
The CFPB has provided a safe-harbor exemption from its regulation on international remittances if any entity has no more than 100 such transfers
, but those with more than 100 transfers per year will have the rule apply. How will your credit union be impacted by this rule?
No effect - credit union has no more than 100 such transfers per year
Higher costs will be incurred by the credit union
Higher fees will be imposed on members seeking such transfers
Credit union will discontinue international remittance services
Following CUNA's meeting and discussions with CFPB Director Richard Cordray, the agency has proposed changes to improve the final rule on international remittance transfers. Please indicate how strongly you support each of the following changes.
Level of support/opposition
Errors resulting from incorrect account numbers provided by
consumer senders of remittance transfers
The agency proposes that where the provider can
demonstrate that the consumer provided the incorrect account number,
the provider would be required to attempt to recover the funds
but would not be liable for the funds if those efforts are unsuccessful.
Disclosure of certain foreign taxes and recipient institution fees
The agency proposes additional flexibility regarding
these requirements, including by permitting providers to base
fee disclosures on published bank fee schedules and by
providing further guidance on foreign tax disclosures where
certain variables may affect tax rates.
Disclosure of regional and local taxes
The agency proposes that the obligation for providers
to disclose foreign taxes imposed on remittance transfers is
limited to taxes imposed at the national level, and does not include
taxes that may be imposed by foreign, sub-national jurisdictions.
In addition to the three areas above, are there other aspects of the final rule for which you would like the CFPB to provide further regulatory flexibility and relief? If so, please explain.
The CFPB will extend the effective date of the final rule until 90 days after the agency finalizes the new proposal; the new effective date is expected sometime during the spring of 2013. Will this extended effective date provide adequate time for implementation for your credit union?
Yes (if yes, skip to Q.6)
No (if no, continue with Q.5b)
How long after the finalization of the new proposal would provide adequate time for implementation?
12 or more months
What, if anything, does your credit union still need to do in order to be in compliance with the final rule?
What is your credit union's asset size?
Less than $5 million
$5 million to $10 million
$10 million to $20 million
$20 million to $50 million
$50 million to $100 million
$100 million to $200 million
$200 million to $500 million
$500 million to $1 billion
$1 billion or more
Contact Information (Optional).
Thank you for your efforts in responding.